We’ve all been there. Your customer forgets to pay their last bill, and now you’re short a couple hundred bucks. Is there a good way to collect this overdue invoice? Do you bring it up and risk compromising your relationship with them? Or do you let it slide and absorb the loss and hope they don’t forget again, even though doing this costs you thousands a year? What’s the right course of action here? Here are some things you could do to streamline your payment collection process.
1. Set your customers up on a subscription payment model.
If you’ve already established a relationship with a particular customer, chances are they’re a repeat customer. If they come in regularly, consider setting them up on a subscription payment model. Automatic invoicing and billing means less work for you (and no more worrying about whether you’ve charged them already) and less work for your customers (no more worrying about whether they’ve paid yet.) And what’s more, if you set them up for ACH payments through Finli, they don’t have to pay a processing fee, and you don’t either. It’s completely free! It’s cost effective and convenient all around. If you’d like to learn more about what subscriptions can do for your small business, this article dives deep into several more reasons.
2. Make chasing down overdue payments a thing of the past.
Chasing down payments is time consuming, emotionally draining, and, not to mention, straight up embarrassing for both you and your customer. Nobody wants to say or hear the words “overdue invoice collection,” and here are some ways for you to avoid it completely (while still getting paid what you’re owed) in the future.
- Staying organized with who owes what.
- Keep track of your customers’ payment histories so there’s no confusion about whether a bill has been paid. Finli has a CRM that does this for you. You can even send an invoice to your customer directly through the CRM!
- Make sure you communicate your payment expectations up front. (Don’t start with bad habits!)
- Habits are notoriously hard to break, and it’s extra complicated when money is involved. Set clear expectations about how much they need to pay you and the deadline they need to pay you by. Taking the time to make this extra clear in the beginning of your customer relationships can save you a ton of headache (and money!) in the future.
- Offer payment plans for large sums.
- Offering the opportunity for your customers to pay in smaller increments over time could make it easier on them and their budgets.
- Consider penalties and late fees.
- When push comes to shove, you could always incorporate late fees into your customer’s invoice. Remind them that it’s not personal – every customer who pays late has to pay the standard late fee. Chances are, they won’t be paying late again.
- Offload payment chasing to a non-partial third party who has your best interest at heart.
- By delegating this responsibility to a third party like Finli, you give yourself the leeway to preserve your relationships with your customers. Fractured relationships are tough to mend, and having a third party involved can ensure that you maintain a light, frictionless, and friendly relationship with those who keep you in business.
3. Simplify and streamline your payment collection process.
Make it easy for the customer to pay and easy for you to accept payment. One way to do so is by digitizing your payment collection process. (Here’s why that’s a good idea.) Accepting cash and checks can be quite costly because of the fees and risks associated with them, and not all digital payment platforms are created equal. (Here’s everything you need to know about different payment collection methods as a small business owner.) Traditional means of digital payment collection could mean getting paid through multiple channels, which is confusing and hard to keep track of. However, through Finli, you can get paid, keep track of your customers and their payment history, manage scheduling, and more, all in one place. Not to mention, you can boost your small business’s brand and reputation by offering one professional platform for customers to conduct their transactions through.
You work hard for your money, and how to collect payments should be the last thing you have to worry about. That’s why we built Finli. Through Finli, you can manage you and your customers’ schedules, send out invoices, and receive payments – all in one place. Sounds enticing? Schedule a demo today.